The price of calcium carbide may rise above the cost line of most companies
After the country's regulation and control of the real estate market was conducted to the steel, building materials, and PVC industries, this year it triggered the "heavy cold" in the calcium carbide market. In the first quarter of this year, due to the serious shortage of downstream chlor-alkali enterprises, the demand for calcium carbide shrank sharply, which exacerbated the contradiction in the supply of calcium carbide in the market and caused the price to continue to decline. Among them, the ex-factory price of calcium carbide in the northwestern region once bottomed out to 3,150 yuan (t price, the same below), and the lowest in the southwest region fell below 3,350 yuan. The above price, lower than the cost of most sealed furnace companies, broke through the bottom line of prices of all internal combustion furnace companies, causing a large area of ​​production cuts and shutdowns of calcium carbide companies. The market supply and demand relationship has gradually become more balanced, which has induced a rebound in the calcium carbide market in April. By the end of April, the ex-factory price of calcium carbide around the country has generally risen by more than 300 yuan from the previous low. Among them, the ex-factory price of calcium carbide in the Northwest China climbed to 3,500 yuan, rising to 3,600 yuan in North China and 3,800 yuan in Southwest China. However, the rise in the price of calcium carbide stimulated enterprises that had previously stopped production to resume production, and the phenomenon of oversupply re-emerged. The price of calcium carbide fell quickly after the “May 1st†holiday, and this round of rally has ended. "Although compared with the previous high point, calcium carbide prices have fallen 50 to 100 yuan, but far from the callback in place, will further decline in the latter part." Calcium carbide expert Ma Zhanyu is not optimistic about the market outlook for calcium carbide. He said that due to the serious surplus of calcium carbide production capacity in the country, and the downstream PVC enterprises are affected by the downturn in the real estate market, it is difficult to change the situation of low operating rate in the short term, and the demand for calcium carbide in the latter period is difficult to continuously increase. However, after the rise in April, the current price of calcium carbide is enough to enable the internal combustion furnace companies to achieve a break-even balance. Large-scale sealed furnace companies already have a certain profit, and coal-electricity-integrated calcium carbide enterprises with complete upstream and downstream facilities are profitable. . Under such circumstances, companies will seize the opportunity to start production at full capacity and increase the calcium carbide market supply and social inventory. However, calcium carbide is not inferior to other products. If it is exposed to rain or moisture for a long time, it will cause unsafe accidents such as fire explosion. Therefore, once the market declines due to oversupply, prices will be promoted by companies at any cost, exacerbating the contradiction between market supply and demand, and accelerating price declines. In fact, the hidden dangers in the later period of the calcium carbide market are far from these. The reporter learned that the sluggish market conditions in the first quarter led to a large-scale shutdown of calcium carbide enterprises in Shaanxi Fugu and Wulanchabu, Inner Mongolia, which have affected the economic growth and grid balance in these areas. The local governments have already issued electricity for calcium carbide. The financial subsidy policy ranging from 0.01 to 0.02 yuan/kWh can help companies overcome difficulties and resume production. Among them, the electricity price subsidy policy in Wulanchabu, Inner Mongolia, lasts for 3 months and will continue until May 26; the Fugu County subsidy policy in Shaanxi Province will last longer. These policies have reduced the cost of calcium carbide by 40 to 70 yuan, which has boosted the operating rate of calcium carbide companies in these areas by more than 80%. This will further aggravate the contradiction between supply and demand in the national calcium carbide market and suppress price declines. “The large-scale sealed calcium carbide furnaces launched in the past two years focused on production in the second half of this year and the first half of next year will lead to an increase in the country’s calcium carbide capacity surplus from the current 30% to more than 50%, which will pose a long-term hidden danger for the future development of calcium carbide. "Zhang Yu, Chairman of the Board of Directors of China Calcium Carbide Industry Association and chairman of Inner Mongolia Baiyan Lake Chemical Co., Ltd., said anxiously. Zhang Yu said that in the case of severe excess production capacity of calcium carbide, once the market outlook picks up, the price of calcium carbide rises above the cost line of most companies, causing companies that had previously stopped production to resume production, and suddenly increase market supply and lower prices. However, he also emphasized that due to the fact that China’s general price level will continue to operate at a high level this year, expectations and momentum for further increases in electricity prices, freight rates, blue carbon, white ash, labor, finance, etc., will form strong support for the price of calcium carbide, making it difficult to generate calcium carbide. Deep callback. According to the industry, the average power consumption of calcium carbide is 3,450 kWh, 1.15 tons of white ash and 0.8 tons of consumption of blue carbon, and the electricity price in the western region is generally as high as 0.43 to 0.48 yuan/kWh, the price of blue carbon is more than 1,020 yuan, and the price of white ash is more than 400 yuan. With calculations and man-made and administrative expenses, the cost of calcium carbide production in most enterprises in the western region has exceeded 3,300 yuan. The cost of calcium carbide in the central and southeast regions is even higher. Therefore, it is expected that the ex-factory price of calcium carbide in the western region will fluctuate from 3,250 to 3,600 yuan. The ex-factory price of calcium carbide in the central and southwestern regions will converge around 3,400 to 3,800 yuan. 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